Markets around the world showing losses

US share markets closed lower overnight, mirroring losses recorded in other major share markets across the globe.

Energy shares dragged the major bourses lower, as crude oil prices dropped. The appetite for risk from investors also waned; new US immigration curbs are stirring concerns about the impact of US President Trump's policies on global trade and the economy.

At the close, the S&P 500 was down 0.9% and the Dow Jones was down 0.6%. Key country share indices for Germany, France, Italy and Spain closed down by more than 1%.

The UK FTSE 100 index closed down by nearly 1%.

Interest Rates:

US Treasury yields were little changed overnight ahead of policy meetings of the US Federal Reserve tonight and tomorrow and a heavy week of economic data.

The yield on the US 10-year bond rose by 1 basis point (bp) while it fell 1 bp the 2-year bond.

Foreign Exchange:

The US dollar index was little changed on the day. EUR/USD made a round trip from 1.0700 to 1.0620 and back.

For the year to December, retail sales rose by 0.6%, down from growth of 1.7% in the year to November. It was the second consecutive month of annual growth in retail sales, following a period of decline since February 2016.

New Zealand:

The trade deficit narrowed to NZ$41mn in December, from a deficit of NZ$746mn in November. The narrowing of the trade deficit in December reflected both increased exports and a fall in imports.

United States:

Personal spending rose by 0.5% in December, after growth of 0.2% in November. It points to sustained domestic demand that is likely to set the economy up for stronger growth in early 2017. This data was included in the fourth quarter GDP figures published on Friday.

The core personal consumption expenditure (PCE) index rose by 1.6% in the year to December, the biggest increase in over two years.

The core PCE, which is the Federal Reserve's preferred inflation measure, rose by 1.7% in the year to December. It remains below the Fed's 2% target.

Pending home sales rose by 1.6% in December, after a fall of 2.5% in November.

The rise in December is partly attributed to a rush by US home buyers to lock in rates before they rise further. Limited stock of existing homes is hindering the pace of sales.

Dallas Fed manufacturing activity index rose from 17.7 in December to 22.1 in January. It is the highest reading since April 2010.